Let's Get Back to Real Business

By John Powell (@alfresco) Sep 27, 2011

August was a bad month for innovation.

HP killed off WebOS, announced plans to spin out its PC business, and flaunted the company’s plans to acquire Autonomy.

If that wasn’t enough — the CEO and driving force behind one of the most innovative companies in history resigned.

Perhaps the Steve Jobs resignation couldn’t have come at a better time for our industry. It should be a wake-up call for the rest of the technology industry. Steve Jobs is synonymous with innovation, and his legacy is marked with unbridled success. His focus on reinventing existing markets and creating new markets has led to some of the most significant developments in the history of personal computing.

Sadly — during a time when our industry should be celebrating innovation — we instead have been left with an alarming juxtaposition of an innovative leader in Jobs, and HP giving up on the most promising and innovative technologies in their portfolio for the sake of building out an old-fashioned enterprise software business.

HP is reaching deep down into enterprise software’s oldest bag of tricks, snapping up a large software vendor and buying their way into an IT business with cash and business maneuvers.

Acquisitions, vendor lock-in strategies and monolithic information technology is NOT innovation. While this industry desperately needs to shift the focus back to innovation, many of our peers are content to buy, sell and market their way to profits, without ever giving a moment’s notice to the effect such behavior has on our reputation as an innovative industry, as leaders, and as a major contributor in the global economy.

This is Bad for the Buy-Side

It’s a vicious cycle.

Autonomy was founded on great innovation, and the company exploded in value during the dot-com boom as UK investors bought in on the promise of the “British Google.”

However, innovation is very hard, and Autonomy found that in order to feed investors’ quarterly appetite, they needed to deliver regular topline growth. So the company embarked on a dizzying spree of acquisitions to bulk up revenues. Their “dot com” proceeds gave them lots of firepower to acquire. Autonomy rapidly moved to become the CA of content management, buying established companies with limited prospects and integrating disparate technologies with the Autonomy Idol “marketecture.” These offerings could now be cross-sold by a rapacious sales force to a locked-in customer base.

And that’s how Autonomy became the company it is today. Amazingly, the cycle is repeating itself once again — and it’s reminiscent of nesting dolls, each jar consuming its smaller counterpart, until you’re left with just one, massive, extremely dense entity.